Brazil CBS/IBS Reform: Non-Resident Digital Service Providers Set to Be Covered from August 2026

Brazil's Consumption Tax Reform to Cover Non-Resident Digital Providers

According to VATCalc, Brazil plans to bring non-resident digital service providers and marketplaces into its new consumption tax framework as part of a comprehensive reform. The announcement points to an August 2026 start for these obligations.

Background

Brazil is gradually replacing its complex existing indirect tax structure (such as PIS, COFINS, ICMS and ISS) with a new dual VAT-style system. This framework consists of a federal CBS (Contribuição sobre Bens e Serviços) component and a sub-national IBS (Imposto sobre Bens e Serviços) component. The reform aims to simplify indirect taxation and extend it to the digital economy.

Who is affected

Non-resident companies supplying digital services to Brazilian consumers or businesses, as well as the online platforms facilitating such supplies, will be the primary parties affected. In line with practice in many jurisdictions, marketplaces may be made responsible for collecting and remitting tax on certain transactions.

What to do

Businesses likely to be affected should assess their digital service sales into Brazil and monitor the detailed rules for non-resident providers along with the final effective timeline. Registration, pricing, invoicing and reporting processes may need to be prepared to meet the new obligations. Cautious planning is advisable until the implementation details and final dates are confirmed through official regulations.

Source: VATCalc — https://www.vatcalc.com/brazil/brazil-vat-non-resident-digital-services-providers-marketplaces-2026/